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GOVERNMENT of ANDHRA PRADESH
FINANCE DEPARTMENT
Previous Budget Speeches

PREVIOUS ECONOMIC TRENDS 1990-91

 

Economic Survey 1990-91

1. Highlights

1.1. The net State Domestic product at constant prices increased from Rs.10,631 crores in 1988-89 to Rs.10,861 crores in 1989-90 while the per capita state income at constant prices increased from Rs.1724 in 1988-89 to Rs.1732 in 1989-90.

1.2. The overall seasonal conditions during the year 1990-91 were generally good though there were dry spells in the month of July and excessive rains due to a depression in the second fortnight of August which had an adverse impact on the area sown during kharif season. Closure of the canals for undertaking drainage works in Krishna and Godavari delta systems, adversely affect4ed the area under paddy during Rabi season. During the year 1991-92 the south-west monsoon set in well in time and progressed satisfactorily up to the end of July 1991. All the three regions in the State received rainfall in excess over the normal As the sowing of Kharif dry crops started in time normal areas are expected to be covered.

1.3. The production of food grains reached an all time record level of f88.21 lakh tonnes in kharif against 88.13 lakh tonnes achieved in kharif 1989-90 while it declined marginally to 38.13 lakh tonnes from 39.58 lakh tonnes in Rabi. The overall food grains production in 1990-91 amounted to 126.34 lakh tonnes as against 127.71 lakh tonnes in 1989-90 though there was decline in area in both the seasons.

1.4. During 1990-91, the average general index of industrial production rose by 8.7 perc3ent over that of the previous year. This increase is attributable minly to improvement in power position and better labour situation.

1.5. In Public Enterprises, the Capital employed was doubled and turn over recorded an increase of about 53 percent during the period 1985-86 to 1989-90. However both profitability and Return on Investment gradually declined.

1.6. As a result of effective implementation of poverty alleviation programmes, the poverty ratio which was 43.6 percent in 1977-78 declined to 31.6 percent in 1987-88.

1.7. There has been significant progress in the sphere Health-Care. Birth rate came down from 28.8 per 1000 in 1957 to 25.6 in 1989, while the death rate came down more sharply from 15.7 to 9.3 during the same period. Infantile mortality rate came down significantly from 92.6 per 1000 in 1957 to 81.0 in 1988.

1.8. The growth in the number of pre-primary, primary, and secondary level institutions and the intake of students in theses institutions was remarkable The literacy rate which was 21.2 in 1961 improved to 45.1 in 1991.

1.9. During the year 1990-91, an additional capacity of 306 MW was added to the installed capacity, bringing the total installed capacity ,to 4131 MW and the generation of power reached 18,804 million Kwh.

1.10. The demand for public transport facilities has been rising. While the average number of buses on road and the number of passengers carried increased, the volume of operation and fleet utilisation declined. With the addition of 29 new bus stations with modern facilities, the total no. of bus stations stood at 309 at the end of 1990-91. Computerized seat reservation system was introduced in some of these bus stations.

1.11. There was considerable improvement in the labour situation during the year 1990-91 compared to the previous year and the days lost in industrial work stoppages declined from 20.36 lakhs in 1989-90 to 4.18 lakhs in 1990-91.

1.12. The average consumer price index for industrial workers during 190-91 over that of 1989-90 rose by 12.7 percent, whereas the index for the same period rose by 13.5 percent at the all India level.

1.13. The Public Distribution System has been further strengthened and streamlined by opening new fair price shops and weeding out bogus cards.

1.14. As at the end of Dec.1990. There were 4569 branches of scheduled commercial banks in the State with total deposits of Rs.10.011.77 crores and outstanding credit of Rs.8,495.34 crores. Backward areas in the State received 41.2 percent of the total disbursement of Rs.727.22 cores made by all financial institutions.

2. Net State Domestic Product

2.1. With the introduction of new series on National Accounts Statistics with 1980-81 as the base year, replacing 1970-71 series, the Net State Domestic Product has been revised from f1980-81 onwards both at current and constant (1980-81) prices, by adopting the revised methodology and data base after a adopting the revised methodology and data base after a comprehensive review in the estimation of various aggregates.

2.2. The Net State Domestic Product increased during 1989-90 both at current and constant prices over that of the previous year. At constant (1980-81) prices, the Net State Domestic Product amounted to Rs.10,861 crores in 1989-90 registering an increase of 2.2 percent over that of the preceding year. AT current prices the Net State Domestic Product amounted to Rs.21,096 crores registering an increase of 2.5 percent over that of 1988-89.

2.3. The composition of the Net State Domestic Product reveals the continuing dominance of Agriculture.

Composition of Net State Domestic Product

At Constant (1980-81) Prices :

(Figures are in percentage)

Sector

Share in State Domestic Product

1987-88

1988-89

1989-90

(Provisional)

(Quick)

Primary (Agriculture)

40.9 (38.9)

41.1 (39.4)

42.6 (40.6)

Secondary

18.3

17.6

15.5

Tertiary

40.8

41.3

41.9

Total :

100.0

100.0

100.0

2.4. At current prices, the per capita State Income (Net State Domestic Product) increased from Rs.3,340 in 1988-89 to Rs.3,364 in 1989-90 recording an increase of 0.7 percent. At constant (1980-81) prices, the per capita State Income increased from Rs.1,724 in 1988-89 to 1732 in 1989-90 showing an increase of 0.5 percent.

3. Seasonal Conditions

3.1. During the year 1990-91, though the south-west monsoon had set in early and most of the districts received adequate rainfall, there were dry spells in the month of July 1990 due to which there was reduction in the area sown under various food crops. Even the irrigation sources did not receive adequate water for paddy transplantation. Due to formation of a depression in the second fortnight of August, 1990 in the Bay of Bengal, there were excessive rains due to which standing crops such as paddy, sharif pulses were damaged besides loss to human lives, livestock and public and private properties in many districts. In some of the districts, particularly in East and West Godavari districts, paddy crop was affected by "TUNGRO VIRUS" resulting in lower yields. During the South-west Monsoon, the State as a whole received an average rainfall of 619 mm. As against the normal rainfall of 634, the deficit being 2 percent.

3.2. During the north-east monsoon, the State received an average rainfall of 250 mm (provisional) as against the normal rainfall of 206 mm which helped the kharif standing crops and also the sowings of Rabi crops.

3.3. During the year 1991-92 the south-west monsoon which had set well in time progressed satisfactorily up to the end o July 1991. During the first two months viz., June and July of the monsoon the State as a whole received an average rainfall of 335 mm as against the normal of 293 mm, the excess being 21 percent. All the three regions in the State viz., Coastal Andhra, Rayalaseema and Telangana received excess rainfall of 35 percent, 64 percent and 6 percent respectively. As a result of timely good rainfall, sowings of kharif dry crops have started right intime and normal areas are expected to be covered.

4. Agriculture

Over the years there has been an improvement in the level of productivity of number of crops. This is mainly attributable to adoption of improved technology and practices of agriculture. The productivity levels attained in 1990-91 in respect of most of the crops except tobacco were higher than those in the previous the crops except tobacco were higher than those in the previous year. But when compared to the quinquennial average for the period 1985-86 to 1989-90 the productivity levels attained in respect of all major crops in 1990-91 have shown an increase.

YIELD PER HECTARE OF PRINCIPAL CROPS

(in Kgs.)

Sl. No. Crop

Average
1985-86 to
1989-90

1985-86

1986-87

1987-88

1988-89

1989-90

1990-91

1. Rice

2290

2264

1951

2258

2572

2403

2448

2. Jowar

613

650

600

662

467

688

726

3. Maize

1714

1433

1494

1756

1653

2244

2251

4. Chillies

1551

1619

1462

1475

1594

1607

1694

5. Castor

211

186

176

233

209

250

251

6. Sugar cane (Tons)

69

73

64

66

70

70

70

7. Groundnut

893

787

833

997

938

915

1011

8. Cotton (lint)

202

204

252

159

153

244

285

9. Tobacco

1089

959

975

1038

1233

1242

1142


4.2 There was decline in the area under food grains during the year 1990-91 due today spells in the month of July 1990, excessive rains due to depression in the second fortnight of August 1990 and due to closure of canals in Krishna and Godavari delta systems in Rabi Season. Besides, there was sharp decline in the yield of rice, particularly, in East Godavari and West Godavari districts due to incidence of "TUNGRO VIRUS". In spite of all these adverse conditions, the kharif foodgrains production during 1990-91 attained the record level of 88.21 lakh tonnes surpassing the highest production of 88.13 lakh tonnes achieved in kharif 1989-90. However the production of foodgrains during rabi 1990-91 has declined to 38.13 lakh tonnes from 39.58 lakh tonnes attained in the previous year.

4.3. Thus due to higher productivity levels in respect of major crops, the foodgranis production during the year as a whole was 126.34 lakh tonnes as against the production of 127.71 lakh tonnes in 1989-90. It is heartening to note that the oil seeds production for the year 1990-91 registered an all time record of 26.81 lakh tonnes surpassing the earlier record production of 23.10 lakh tonnes attained in 1988.89.

5. Industry

5.1. The average Index of Industrial Production for the year 1990-91 increased by 8.7 percent when compared with the previous year due to improvement in power position and better labour situation.

Monthly Index Numbers of Industrial Production

(Base 1970-71=100)

Sl.No. Month

Index in
1989-90

Index in
1990-91

Percentage
change in 1990-91
over 1989-90

1. April

257.7

264.8

+ 02.8

2. May

256.2

320.0

+ 24.9

3. June

308.0

344.3

+ 11.8

4. July

283.0

379.7

+ 34.2

5. August

333.2

395.8

+ 18.8

6. September

353.7

371.8

+ 05.1

7. October

320.2

360.3

+ 12.5

8. November

347.5

375.7

+ 08.1

9. December

450.2

430.9

+ 04.3

10. January

429.7

460.2

+ 07.1

11. Feburary

434.5

470.2

+ 08.2

12. March

623.7

606.6

+ 02.7

Average of

366.5

398.4

+ 08.7


5.2. The production of Sugar, Cotton yarn, Jute, Oxygen, Glass, Cement, Ferro-Alloys, M.S. Rounds and Bars, Motor, Vehicles, Electricity etc., has shown improvement during 1990-91 compared to the preceding year. Inspite of the strikes, the coal production was 177.08 lakh tonnes during 1990-91 as against 178.04 lakh tonnes during the preceding year recording a negligible decline of 0.5 percent.

6. Performance Of Public Enterprises

6.1. The following table given details regarding the performance of Public Enterprises during the period 1985-8 to 1989-90.

Indicators

1985-86

1986-87

1987-88

1988-89

1989-90

No.of Public
Enterprises reviewed

33

33

38

39

39

Total Turnover

242066.54

255751.21

323223.77

395512.00

370255.79

Total Expenses

205709.52

217202.35

281038.85

346732.73

327272.11

Depreciation

12345.71

14056.01

17381.28

19207.59

20435.81

Interest

16502.11

17965.45

20461.09

27345.88

33931.41

Net Profit (PBT)

7563.18

6527.40

4342.55

1445.00

-11711.99

Tax

338.30

294.85

199.38

262.85

245.23

PBIT

24011.31

24492.85

24803.64

28790.88

22219.42

Capital Employed

278129.99

340603.46

418342.77

498932.88

558772.57

Return on Investment
(ROI=PBIT/Cap.Empd.)

8.63

7.19

5.93

5.77

3.98


6.2. During the period 1985-86 to 1989-90 the capital employed was doubled from Rs.2781 crores to Rs.5588 crores and the turnover recorded an increase of about 53 percent. The net profit which was Rs. 75.63 crores in 1985-86 declined graduaully and turned to a loss of rs.117.12 crores by 1989-90. Of this loss of Rs.117.12 crores. As much as Rs.101 crores was accounted for by Singareni Colleries alone and this was reported to be mainly due to retrospective effect of Wage award and labour unrest. The return on investment declined from year to year.

7. Human Resources

7.1. As a result of the poverty alleviation programmes taken up under the Five Year particularly from the Sixth Plan the poverty ratio as estimated by the planning Commission on the basis of the quinquennial Consumer Expenditure Surveys conducted by National Sample Survey Organisation declined from 43.6 percent in 1977-78 t0 31.6 percent in 1987-88.

7.2. There has been significant progress in the sphere of health. The number of Hospitals (Allopathic), Dispensaries and Hospitals for special treatment are 1988 by 1989-90 with a bed strength of 37,020. By 19889 the estimated expectation of life at birth increased to 59.10 years in the case of Males and 62.63 years in the case of Females as against the respective figures of 44.6 years and 43.5 years in 1961-70. The Death rate which was 15.7 per 1,000 in 1957 decreased to 9.3 in 1989 while the Birthrate which was 28.8 in 1957 decreased to 25.6 in 1989. The infant mortality rate which was 92.63 per 1000 live births in 1957 decreased to 81.0 in 1988.

7.3. The growth in the number of primary and secondary level institutions was phenomenal and the increase in the number of students being even more. The number of pre-primary and primary schools which was 28.753 in 1955-56 increased to 47.216 by 1989-90. The number of students in the pre-primary and primary schools was more than doubled during this period from 24.50 lakhs in 1955-56 to 56.80 lakhs by 1989-90. Similar trend was observed in the middle and high schools as also in the general and professional colleges. The over all literacy rate which was only 21.2 in 1961 improved to 45.1 in 1991.

8. Power

8.1. During the year 1990-91, an additional capacity of 210 MW under thermal power system, 30MW under Hydel Power System and 66 MW under Gas Power system were commissioned bringing the total installed Capacity to 4131 MW in the State.

8.2. Generation of power during 1990-91 was of the order of 18,809 million kwh recording an increase of f19.8 percent over the preceding year. Out of this energy generated, 8,102 m kwh was through Thermal Power Stations and 9,902 m kwh was through Hydel Power System, constituting 45.0 percent and 55.f0 percent respectively. Hydro generation during the year 1990-91 over the previous year recorded an increase of 26.9 percent, while Thermal generation also showed an increase of 12.2 percent over the previous year. Hydel Power Systems accounted for 59 percent of the total installed capacity at the end of the year 1990-91, but their share in power generation was only 55.0 percent during the said year. Thermal Power Stations accounted for only 39 percent of the total installed capacity but its share in power generation was 45.0 percent.

Power Generation in the State

(Mn. KWH)

 

1985-86

1986-87

1987-88

1988-89

1989-90

1990-91

Hydro

5453
(44.6)

6517
(47.2)

5864
(42.3)

6880
(48.6)

7802
(51.9)

9902
(55.0)

Thermal

6772
(55.4)

7282
(52.8)

7985
(57.7)

7263
(51.4)

7222
(48.1)

8102
(45.0)

Total

12225
(100.0)

13799
(100.0)

13849
(100.0)

14143
(100.0)

15024
(100.0)

18004
(100.0)


8.3. An additional number of 0.82 lakh Agricultural pumpsets were energised during the year 1990-91 bringing the total number of agricultural connections to 11.93 lakhs by the end of March 1991. Consumption of power for agricultural uses constituted 37 percent of total power consumption in the State during 1989-90 as compared to 34 percent in 1988-89.

8.4. The per capita consumption of power in Andhra Pradesh was 253 kwh in 1990-91. An additional number of 673 hamlets and 1299 Harijanwadas have been electrified during the year 1990-91.

9. Transport

9.1. Transport plays a vital role for the devlo0pment of various sectors in economy. The demand for public transport facilities, has been increasing and hence due priority is given for this sector. As regards the Andhra Pradesh State Road Transport Corporation, the average number of buses on road were 13,669 by 1990-91 as against 12, 647 in 1989-90. The number of passengers carried increased from 83.25 lakhs in 1989-90 to 93.30 lakh in 1990-91. However, the volume of operation and fleet utilisation declined in 1990-91 when compared to 1989-90, due to disturbances to traffic movement, bandhs, Gulf crisis etc.

9.2. Passenger amenities, which is given utmost priority by the Corporation continued in a big way in the year 1990-91 also. With the opening of 29 new bus stations with modern facilities for the use of travelling public this year, the total number of such Bus Stations stood at 309 at the end of 1990-91. Computerized Seat Reservation. System was introduced in some of these bus stations. New way-side bus shelters numbering 127 were constructed and put to use in this year making a total of 1057 at the end of the year.

10. Labour And Employment

10.1 There is considerable improvement in the labour situation during the year 1990-91 compared to the previous year. The man days lost in Industrial work stoppages during this year were only 4.18 lakhs as against 20.36 lakhs in the preceding year.

10.2. The total number of persons employed in the organised sector in the State increased from 16.94 lakhs at the end March 1989 to 17.31 lakhs at the end of March 1990. The organised sector comprises all establishments in the public sector and non/agricultural establishments in the private sector employing ten or more persons. Out of the total employment in the organised sector in the State at the end of the March 1990. Public Sector accounted for 13.68 lakh persons while the remaining 3.63 lakh persons were employed in the private sector.

10.3. A total number of 30.36 lakh persons were on the live registers of employment exchange in the State as at the end of March 1991 representing an increase of 7.7 percent over the level obtained a year ago.

11. Prices

11.1 The average Consumer Price Index number for Industrial workers in Andhra Pradesh (with base 1960=100) which stood at 851 in March 1990, increased to 959 in March 1991 recording an increase of 12.7 percent, while at the All India Level it rose continuously from 873 to 991, registering an increase of 13.5 percent. In the corresponding period of the last year the percentage increase in the State Index was 6.0 percent as against 6.7 at All India Level.

11.2. The average Consumer Price Index number for urban non-manual employees in the State ( with base 1960=100) increased from 848 in March, 1990 to 951 in March 1991 recording an increase of 12.1 percent. During the same period All India Index rose from 793 to899 registering an increase of 13.4 percent. During the corresponding period of the last year the State Index recorded a increase of 8.6 percent while the All India Index rose by i.e. percent.

11.3. The average Consumer Price Index Number for Agricultural labour in the State (with base 1960-61=100) rose from 601 in March, 1990 to 675 in March 1991 recording an increase of 12.3 percent while at the All India Level it rose from 736 to 858 registering an increase of 16.6 percent during the same period. In the corresponding period of the last year the state Index recorded a fall of 1.5 percent

11.4. while the All India Index rose by 1.0 percent.

The wholesale price index number for agricultural commodities in A.P. (With base 1970-71=100) increased from 404.1 in March 1990 to 481.6 in March 1991 registering an increase of 19.2 percent. AT the All India Level, the index rose from 418.5 to 505.6 recording a rise of 20.8 percent during the same period. The percentage increase during the corresponding period of the last year was 8.9 in the case of Andhra Pradesh against 4.1 in All India.

12. Public Distribution System

12.1. The public distribution system has been further strengthened and streamlined during the year ending October by opening new fair pric3e shops and by weeding out bogus Card in additional number of 172 Fair Price shops have been opened raising the total number of Fair Price Shops in the States 35,645 at the end of October 1990. During November 1990 to June 1991, 187 more new fair pric3 shops were opened raising the number of fair price shops in the State to 35, 832 at the end of June , 1991. Of these, as many as 6865 shops are in urban areas and 28967 are in rural areas.

12.2. During the year ending October, 1990, 21.11 lakh tonnes of Rice has been distributed as against 20.01 lakh tonnes in the preceding year. In the case of Edible Oil and Kerosene there was an increase in the public distribution, while the previous year's level was more or less maintained in respect of Sugar and Wheat.

Distribution of Essential Commodities through the Public Distribution System during the period 1987-88 to 1990-91

(Year is from November to October) (Lakh tonnes)

Sl.No.

Commodity

1987-88

1988-89

1989-90

1990-91
(Nov 90 - June 91)

1.

Rice

18.67

20.01

21.11

13.36 (Nov.90 to
May 91)

2.

Wheat

0.81

1.10

1.03

0.75

3.

Edible Oil

1.17

0.20

0.41

0.04

4.

Sugar

3.07

3.14

3.11

2.03

5.

Kerosene
(Lakh kilo ltrs.)

6.32

6.76

7.28

4.97


13. Credit

13.1. As at the end of December 1990, there were 4569 branches of Scheduled Commercial Banks in Andhra Pradesh with total deposits of Rs. 10011.77 crores and outstanding credit of Rs.8495.34 crores. During the period ending December 1990, the total number of bank branches increased by 1.2 percent while the total deposits increased by 14.4 percent and credit by 10.2 percent over the corresponding period of last year. The rural branches constituted 58.3 percent of the total branches, but their share was 17.2 percent in total deposits and 20.7 percent in credit as at the end of December 1990.

13.2. The Refinance extended by NABARD amounted to Rs.188.80 crores during the year 1989-90. The disbursements made by IDBI for industrial development schemes amounted to Rs.415.91 crores and that of S.F.C. to 128.34 crores during the year 1989-90.

13.3. Out of the total disbursement of Rs.727.22 crores made by All Financial Institutions in the State (excluding NABARD) backward areas received to a tune of Rs.299.67 crores i.e. 41.2 percent in 1989-90.

 

 
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